PART 1INTRODUCTORY

Citation, commencement, revocation and application

1.-(1) This Order may be cited as the Export Control (Iran Sanctions) Order 2012 and comes into force on 1st June 2012.

(2) The Export Control (Iran) Order 2011 is revoked(7).

(3) An offence may be committed under this Order-

(a)in the United Kingdom by any person;

(b)elsewhere by any person who is a United Kingdom person within the meaning of section 11 of the Export Control Act 2002.

Interpretation

2.-(1) In this Order-

"the 1979 Act" means the Customs and Excise Management Act 1979(8);

"the 2008 Order" means the Export Control Order 2008(9);

"EU authorisation" means an authorisation granted under Article 3, 5(2), 7, 18 or 19 of the Iran Sanctions Regulation or under Article 1b or 1c of the Iran Human Rights Regulation;

"the Iran Human Rights Regulation" means Council Regulation 359/2011 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Iran and a reference to an Annex to that Regulation is to be construed as a reference to that Annex as amended from time to time;

"the Iran Sanctions Regulation" means Council Regulation (EU) No 267/2012 concerning restrictive measures against Iran and repealing Regulation (EU) No 961/2010(10), and a reference to an Annex to that Regulation is to be construed as a reference to that Annex as amended from time to time.

(2) An expression used both in this Order and in the Iran Sanctions Regulation or the Iran Human Rights Regulation has the meaning that it bears in those Regulations.

Savings

3. An authorisation which was granted under Article 3, 5(2), 7, 12 or 13 of Council Regulation (EU) No 961/2010 and was in effect immediately before the coming into force of this Order has effect as if it were an authorisation granted under Article 3, 5(2), 7, 18 or 19 respectively of the Iran Sanctions Regulation.

PART IIOFFENCES RELATING TO PROHIBITIONS IN THE IRAN SANCTIONS REGULATION

Offences related to goods and technology listed in Annex I or II or in the Common Military List of the European Union

4. A person who is knowingly concerned in an activity, other than the export or the import of goods, prohibited by any of the following Articles of the Iran Sanctions Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 2(1) (prohibition on sale, etc. of goods and technology listed in Annex I or II to any Iranian person, entity or body or for use in Iran);

(b)Article 4 (prohibition on purchase, etc. from Iran of goods and technology listed in Annex I or II);

(c)Article 5(1)(a) (prohibition on provision of technical assistance related to the goods and technology listed in the Common Military List of the European Union to any Iranian person, entity or body or for use in Iran);

(d)Article 5(1)(b) (prohibition on provision of technical assistance or brokering services related to the goods and technology listed in Annex I or II to any Iranian person, entity or body or for use in Iran);

(e)Article 5(1)(c) (prohibition on provision of financing or financial assistance related to goods and technology in the Common Military List of the European Union or listed in Annex I or II to any Iranian person, entity or body or for use in Iran).

Offences related to goods and technology in Annex III

5.-(1) A person commits an offence and may be arrested if that person-

(a)is concerned in an activity, except by exporting goods and technology, for which authorisation is required by Article 3(1) of the Iran Sanctions Regulation (authorisation required for sale, etc. of goods and technology listed in Annex III to any Iranian person, entity or body or for use in Iran);

(b)does not have the required authorisation; and

(c)is knowingly concerned in that activity with intent to evade a prohibition in that Article.

(2) A person commits an offence and may be arrested if that person-

(a)is concerned in an activity for which authorisation is required by Article 5(2)(a) or (b) of the Iran Sanctions Regulation (authorisation required for the provision of technical assistance, financing or financial assistance related to the goods and technology listed in Annex III to any Iranian person, entity or body or for use in Iran);

(b)does not have the required authorisation; and

(c)is knowingly concerned in that activity with intent to evade a prohibition in those Articles.

Offences related to key equipment or technology listed in Annex VI

6. A person who is knowingly concerned in an activity, other than the export of goods, prohibited by any of the following Articles of the Iran Sanctions Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 8(1) (prohibition on sale, etc. of equipment and technology listed in Annex VI to any Iranian person, entity or body or for use in Iran);

(b)Article 9(a) (prohibition on provision of technical assistance or brokering services related to equipment and technology listed in Annex VI to any Iranian person, entity or body or for use in Iran);

(c)Article 9(b) (prohibition on provision of financing or financial assistance related to equipment and technology listed in Annex VI to any Iranian person, entity or body or for use in Iran).

Offences related to crude oil and petroleum products listed in Annex IV

7. A person who is knowingly concerned in an activity, other than the import of goods, prohibited by any of the following Articles of the Iran Sanctions Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 11(1)(b) (prohibition on purchase of crude oil or petroleum products which are located in or which originated in Iran);

(b)Article 11(1)(c) (prohibition on transporting crude oil or petroleum products if they originate in Iran, or are being exported from Iran to any other country);

(c)Article 11(1)(d) (prohibition on provision of financing or financial assistance related to the import, purchase or transport of crude oil and petroleum products of Iranian origin or that have been imported from Iran).

Offences related to petrochemical products listed in Annex V

8. A person who is knowingly concerned in an activity, other than the import of goods, prohibited by any of the following Articles of the Iran Sanctions Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 13(1)(b) (prohibition on purchase of petrochemical products which are located in or which originated in Iran);

(b)Article 13(1)(c) (prohibition on transporting petrochemical products if they originate in Iran, or are being exported from Iran to any other country);

(c)Article 13(1)(d) (prohibition on provision of financing or financial assistance related to the import, purchase or transport of petrochemical products of Iranian origin or that have been imported from Iran).

Offences related to the movement of gold, precious metals or diamonds listed in Annex VII

9. A person who is knowingly concerned in an activity, other than the export or the import of goods, prohibited by any of the following Articles of the Iran Sanctions Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 15(1)(a) (prohibition on sale, etc. of gold, precious metals and diamonds as listed in Annex VII, to the Government of Iran, its public bodies, corporations and agencies, any person, entity or body acting on their behalf or at their direction, or any entity or body owned or controlled by them);

(b)Article 15(1)(b) (prohibition on purchase, etc. of gold, precious metals and diamonds as listed in Annex VII, from the Government of Iran, its public bodies, corporations and agencies, any person, entity or body acting on their behalf or at their direction, or any entity or body owned or controlled by them);

(c)Article 15(1)(c) (prohibition on provision of technical assistance or brokering services, financing or financial assistance, related to goods listed in Annex VII to the Government of Iran, its public bodies, corporations and agencies, any person, entity or body acting on their behalf or at their direction, or any entity or body owned or controlled by them).

Offences related to the movement of Iranian bank notes and coins

10. A person who is knowingly concerned in an activity, other than the export of goods, prohibited by Article 16 of the Iran Sanctions Regulation (prohibition on sale, etc. of newly printed or unissued Iranian denominated bank notes and minted coinage to, or for the benefit of, the Central Bank of Iran) with intent to evade a prohibition in that Article commits an offence and may be arrested.

Offences related to restrictions on financing of certain enterprises

11.-(1) A person who is knowingly concerned in an activity prohibited by any of the following Articles of the Iran Sanctions Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 17(1)(a) (prohibition on the granting of any financial loan or credit to any Iranian person, entity or body engaged in certain specified activities);

(b)Article 17(1)(b) (prohibition on the acquisition or extension of a participation in any Iranian person, entity or body engaged in certain specified activities);

(c)Article 17(1)(c) (prohibition on the creation of a joint venture with any Iranian person, entity or body engaged in certain specified activities);

(d)Article 17(4) (prohibition on establishing cooperation with an Iranian person, entity or body engaged in the transmission of natural gas as referred to in Article 17(3)(b) of the Iran Sanctions Regulation).

(2) A person commits an offence and may be arrested if that person-

(a)is concerned in an activity for which authorisation is required by Article 18(1) of the Iran Sanctions Regulation (the making of an investment through transactions referred to in Article 17(1) in an Iranian person, entity or body engaged in the manufacture of goods or technology listed in Annex III);

(b)does not have the required authorisation; and

(c)is knowingly concerned in that activity with intent to evade a prohibition in that Article.

Offences related to restrictions on investment on Iranian uranium mining and nuclear industry

12. A person who is knowingly concerned in an activity prohibited by Article 22 of the Iran Sanctions Regulation (accepting or approving, by concluding an agreement or by any other means, that the granting of any financial loan or credit, or the acquisition or extension of a participation, or the creation of a joint venture be made by one or more Iranian persons, entities or bodies, in an enterprise engaged in any of the activities specified in Article 22(a) to (c)) with intent to evade a prohibition in that Article commits an offence and may be arrested.

PART IIIOFFENCES RELATING TO PROHIBITIONS IN THE IRAN HUMAN RIGHTS REGULATION

Offences related to equipment listed in Annex III

13. A person who is knowingly concerned in an activity, other than the export of goods, prohibited by any of the following Articles of the Iran Human Rights Regulation with intent to evade a prohibition in those Articles commits an offence and may be arrested-

(a)Article 1a(a) (prohibition on sale, etc. of equipment which might be used for internal repression as listed in Annex III to any person, entity or body in Iran or for use in Iran);

(b)Article 1a(b) (prohibition on provision of technical assistance or brokering services related to equipment which might be used for internal repression as listed in Annex III to any person, entity or body in Iran or for use in Iran);

(c)Article 1a(c) (prohibition on provision of financing or financial assistance related to equipment which might be used for internal repression as listed in Annex III to any person, entity or body in Iran or for use in Iran).

Offences related to equipment, technology and software listed in Annex V

14.-(1) A person commits an offence and may be arrested if that person-

(a)in concerned in an activity for which authorisation is required by Article 1b(1) of the Iran Human Rights Regulation (prohibition on sale, etc. of equipment, technology or software identified in Annex IV to any person, entity or body in Iran or for use in Iran);

(b)does not have the required authorisation; and

(c)is knowingly concerned in that activity with intent to evade a prohibition in that Article.

(2) A person commits an offence and may be arrested if that person-

(a)is concerned in an activity for which authorisation is required by any of the following Articles of the Iran Human Rights Regulation-

(i)Article 1c(1)(a) (provision of technical assistance or brokering services related to the equipment, technology and software identified in Annex IV to any person, entity or body in Iran or for use in Iran);

(ii)Article 1c(1)(b) (provision of financing or financial assistance related to the equipment, technology or software identified in Annex IV to any person, entity or body in Iran or for use in Iran);

(iii)Article 1c(1)(c) (provision of telecommunications or internet monitoring or interception services of any kind to, or for the direct or indirect benefit of, Iran's government, public bodies, corporations and agencies or any person or entity acting on their behalf or at their direction);

(b)does not have the required authorisation; and

(c)is knowingly concerned in that activity with intent to evade a prohibition in those Articles.

PART IVSUPPLEMENTARY PROVISIONS AS TO OFFENCES

Circumvention of prohibitions in the Iran Sanctions Regulation

15.-(1) A person commits an offence (and may be arrested) who participates, knowingly and intentionally, in activities the object or effect of which is (whether directly or indirectly)-

(a)to circumvent any of the prohibitions in Articles 2(1), 3(1), 8(1), 15(1)(a) or 16 of the Iran Sanctions Regulation, or

(b)to enable or facilitate the contravention of any such prohibition.

(2) A person commits an offence (and may be arrested) who participates, knowingly and intentionally, in activities the object or effect of which is (whether directly or indirectly)-

(a)to circumvent any of the prohibitions in Articles 4, 5(1)(a) to (c), 5(2)(a) or (b), 9(a) or (b), 11, 13, 15(1)(b) or (c), 17, 18 or 22 of the Iran Sanctions Regulation, or

(b)to enable or facilitate the contravention of any such prohibition.

Circumvention of prohibitions in the Iran Human Rights Regulation

16.-(1) A person commits an offence (and may be arrested) who participates, knowingly and intentionally, in activities the object or effect of which is (whether directly or indirectly)-

(a)to circumvent any of the prohibitions in Articles 1a(a) or 1b(1) of the Iran Human Rights Regulation, or

(b)to enable or facilitate the contravention of any such prohibition.

(2) A person commits an offence (and may be arrested) who participates, knowingly and intentionally, in activities the object or effect of which is (whether directly or indirectly)-

(a)to circumvent any of the prohibitions in Articles 1a(b) or (c) or 1c(1)(a) to (c) of the Iran Human Rights Regulation, or

(b)to enable or facilitate the contravention of any such prohibition.

Offences related to EU authorisations

17.-(1) A person commits an offence (and may be arrested) who, for the purpose of obtaining an EU authorisation-

(a)makes any statement or furnishes any document or information which to that person's knowledge is false in a material particular; or

(b)recklessly makes any statement or furnishes any document or information which is false in a material particular.

(2) An EU authorisation granted in connection with the application for which the false statement was made or the false document or information furnished is void from the time it was granted.

(3) A person who, having acted under the authority of an EU authorisation, fails to comply with a requirement or condition to which the EU authorisation is subject commits an offence and may be arrested, unless-

(a)the EU authorisation was modified after the completion of the act authorised; and

(b)the alleged failure to comply would not have been a failure had the EU authorisation not been so modified.

PART VENFORCEMENT AND PENALTIES

Penalties

18.-(1) A person guilty of an offence under articles 4(a), 5(1), 6(a), 9(a), 10, 13(a), 14(1), 15(1) or 16(1) of this Order is liable-

(a)on summary conviction-

(i)in England and Wales, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum, or to both;

(ii)in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum, or to both.

(b)on conviction on indictment, to imprisonment for a term not exceeding ten years or to a fine, or to both.

(2) In relation to an offence committed after the commencement of section 154(1) of the Criminal Justice Act 2003(11), for "six months" in paragraph (1)(a)(i) substitute "twelve months".

(3) A person guilty of an offence under articles 4(b) to (e), 5(2), 6(b) or (c), 7, 8, 9(b) or (c), 11, 12, 13(b) or (c), 14(2), 15(2), 16(2) or 17 of this Order is liable-

(a)on summary conviction, to imprisonment for a term not exceeding three months or to a fine not exceeding the statutory maximum, or to both;

(b)on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine, or to both.

(4) In the case of an offence committed under the 1979 Act in connection with a prohibition of exportation in Articles 2(1), 3(1), 8(1), 15(1)(a) or 16 of the Iran Sanctions Regulation or Articles 1a(a) or 1b(1) of the Iran Human Rights Regulation, sections 68(3)(b) and 170(3)(b) of the 1979 Act have effect as if for the words "7 years" there were substituted the words "10 years".

(5) In the case of an offence committed under the 1979 Act in connection with a prohibitions on importation in Articles 4, 11(1)(a), 13(1)(a) or 15(1)(b) of the Iran Sanctions Regulation, sections 50(4)(b) and 170(3)(b)(12) of the 1979 Act have effect as if for the words "7 years" there were substituted the words "10 years".

Application of the 1979 Act

19.-(1) Where the Commissioners for Her Majesty's Revenue and Customs investigate or propose to investigate any matter with a view to determining-

(a)whether there are grounds for believing that an offence under this Order has been committed; or

(b)whether a person should be prosecuted for such an offence,

the matter shall be treated as an assigned matter.

(2) Section 77A of the 1979 Act (provision as to information powers)(13) applies to a person concerned in an activity which, if not authorised by an EU authorisation, would contravene Article 3, 5(2), 7, 18 or 19 of the Iran Sanctions Regulation or Article 1b or 1c of the Iran Human Rights Regulation and accordingly references in section 77A of the 1979 Act to importation or exportation shall be read as including any such activity.

(3) Section 138 of the 1979 Act (provision as to arrest of persons)(14) applies to the arrest of a person for an offence under this Order as it applies to the arrest of a person for an offence under the customs and excise Acts.

(4) Sections 145(15), 146(16), 146A(17), 147(18), 148, 150(19), 151(20), 152(21), 154(22), and 155(23) of the 1979 Act (proceedings for offences, mitigation of penalties, proof and other matters) apply in relation to offences and penalties under this Order as they apply in relation to offences and penalties under the customs and excise Acts.

(5) "The customs and excise Acts" and "assigned matter" have the same meanings as in section 1 of the 1979 Act.

PART VIGENERAL

Review

20.-(1) The Secretary of State must from time to time-

(a)carry out a review of articles 1 to 19 of this Order,

(b)set out the conclusions of the review in a report, and

(c)publish the report.

(2) In carrying out the review the Secretary of State must, so far as is reasonable, have regard to the rules on penalties applicable to infringements of the provisions of the Iran Sanctions Regulation and the Iran Human Rights Regulation and the measures taken to implement them in other member States.

(3) The report must in particular-

(a)set out the objectives intended to be achieved by the rules on penalties applicable to infringements of the provisions of the Iran Sanction Regulation and the Iran Human Rights Regulation established by this Order and the measures taken to implement them,

(b)assess the extent to which those objectives are achieved, and

(c)assess whether those objectives remain appropriate and, if so, the extent to which they could be achieved with a system that imposes less regulation.

(4) The first report under this Order must be published before the end of the period of five years beginning with the day on which articles 1 to 19 come into force.

(5) Reports under this Order are afterwards to be published at intervals not exceeding five years.

EXPLANATORY NOTE

(This note is not part of the Order)

This Order makes provision relating to the enforcement of certain restrictive measures against Iran set out in Council Regulation (EU) No 267/2012 of 23 March 2012 repealing Council Regulation (EU) No 961/2010 (OJ L 88, 24.3.2012, p1) and Council Regulation (EU) No 264/2012 of 23 March 2012 amending Regulation (EU) No 359/2011 (OJ L 87, 24.3.2012, p26) ("the Iran Regulations").

The restrictive measures include prohibitions on trade, technical assistance, financing, financial assistance and brokering in respect of the following: equipment which may be used for internal repression; goods and technology specified in the Common Military List of the European Union; telecommunications monitoring equipment for use by the Iranian regime; equipment and technology for the Iranian oil and gas industry; and newly printed or unissued Iranian denominated banknotes and minted coinage. It also includes restrictions on the trade in gold, precious metals and diamonds with the Government of Iran as well as prohibitions on the import, purchase, transport and financial assistance of Iranian crude oil or petrochemical products and on the participation in certain infrastructure projects in Iran and investments in such projects.

Article 1(2) revokes the Export Control (Iran) Order 2011 (S.I. 2011/1297) which currently makes provisions for offences and penalties for contravention of the trade restrictions against Iran which have been replaced and extended by the Iran Regulations.

Article 3 provides that any authorisations allowing otherwise prohibited acts which were issued under Council Regulation (EC) No 961/2010 continue to have effect for the purposes of the Iran Regulations.

Articles 4 to 16 create offences for contravention of the provisions of the Iran Regulations referred to there. There are already offences relating to prohibited importation and exportation of goods in sections 50, 68 and 170 of the Customs and Excise Management Act 1979 ("the 1979 Act") (1979 c. 2).

Article 17 supplements the provisions of the Iran Regulations that allow a competent authority to authorise activities that are otherwise prohibited. Article 17(1) makes it an offence knowingly and recklessly to provide false information for the purpose of obtaining an authorisation. Authorisations may be subject to requirements or conditions which continue even after the activity authorised has been carried out. Article 17(3) makes it an offence to fail to comply with such continuing requirements or conditions unless they were imposed after the activity was carried out or amended after that time in such a way as to give rise to non-compliance.

Article 18 sets out the penalties relating to the offences in the Order, and makes some consequential modifications to the 1979 Act to ensure that the offences covered by that Act are subject to the same penalties as those in the Order.

Article 19 ensures that the ancillary provisions which apply to the enforcement of customs and excise legislation also apply to the enforcement of the provisions of this Order.

Article 20 requires the Secretary of State to review the operation and effect of this Order and publish a report within five years after it comes into force and within every five years after that. Following a review it will fall to the Secretary of State to consider whether the Order should remain as it is, or be revoked or be amended. A further instrument would be needed to revoke the Order or to amend it.

A regulatory impact assessment has not been produced for this instrument as it has no or minimal impact on business, charities or voluntary bodies. A copy of the Explanatory Memorandum is published alongside the Order on www.legislation.gov.uk . Further information is available from the Export Control Organisation, BIS, 1 Victoria Street, London SW1H 0ET and on BIS website ( w ww.bis.gov.uk).